The survey has it that only about 10% of the working population saves up for uncertainties that might occur in future. It is no doubt that this group of people should receive applause as they do not want to be caught off-guard. An emergency fund is money set aside for use in the case where an unfortunate event happens, and it needs an immediate response. The money can be spare cash from your earnings or saved up cash from an investment. There are groups like the CMC markets that guide you on how to invest and have these kinds of funds at your disposal. This helps you not to be on the disadvantage.
To better understand the merits that come with this package, we look at ways in which they affect our well-being when you have them.
Helps in goal setting and tracking,
With most goals, the worst fear is usually the uncertainty that comes with setting and trying to achieve them. Sticking to a plan after setting it is always the path to success, and with saved cash for the unexpected set-aside, it can be accomplished quickly. A family business can be run with ease if the cash laid down for the future is enough to cater for the emergencies. A good foundation could be built where no matter how unstable the financial situation might be, there is the hope of covering the inevitable emergency that may arise.
Comes in handy when you want to use it.
It entails deciding the perfect time to use the saved up cash. It is very humanly to want to use this money to pay off for your vacation or down payment on that new house among others. It should not be the case as this could serve you better when used for other immediate purposes. When the engine on your car starts removing the bad sound, the emergency money should cater for the repairs. When the roof on the house needs repairs, this would be the best time to use it and also in the event of natural disasters like storms; it could take care of all the repairs.
With the unpredictable market trends today, you are never confident that your job is there for the long haul. Employers might pounce on you and drop the “you are fired” card on you. Emergency funds help you to be able to sustain yourself for that period as you look for another job to cater for your needs. If it takes longer than expected to find employment, you should not worry because the amount saved up would be enough for you and the family, they say you should have enough saved up for 6 months of house bills.
Medical and pet emergencies.
Diseases do not come knocking into our bodies, and they could pop up at any time of the day of the week. When that chest pain or a cough appears from nowhere, it would be so easy for you to use the saved up cash instead of starting to borrow loans. Even though it is not common to many, this could be a determinant of the happiness in a family especially where kids are concerned.one may be able to cater for the normal expenses of the pets, but there are circumstances when the pets may need surgery. This could alter your spending, but with the emergency funds, this could be easy to cater for when it happens. To ensure you’re covered in situations like that, it’s recommended to get pet insurance in place, as well.
The sudden death of someone close to you.
Rarely does one prepare for mourning or plan ahead for it .In the event that it happens, you should not worry about traveling to that different state for the funeral or paying for the burial expenses or cremation expenses, this is because those charges are kept off your credit card due to the existence of the emergency funding.
Even though we all love to spend on today’s needs and satisfactions, it is high time we realize that emergency funds are so vital for our survival. The amount that you consider to save should leave you comfortable to meet your needs and also enough to cover for the unexpected in the long-run, you should be better off than the person who depends on solving today’s problems or those that live the ‘hand to mouth life’. We should learn to invest in the future so as to avoid many inconveniences that are ahead of us.